Impressions from CONEXPO-CON/AGG 2014 on the growing worldwide construction industry

Nearly 130,000 people attended CONEXPO-CON/AGG 2014 in Las Vegas this year. The event set records for exhibit space, number of exhibitors, and education tickets sold while marking the second-highest attendance in the show’s history.

The bustling show floor at CONEXPO-CON/AGG 2014 in Las Vegas earlier this month.

Beyond the sheer size of the exhibition, what we noted most was the international presence at CONEXPO. About a quarter of all attendees came from outside the United States, an increase of 9 percent since the last CONEXPO, and the number of countries represented increased from 159 in 2011 to 170 this year. Most of the international attendees visited from Latin America, China, Canada, and Europe.

We are seeing a robust international presence at all the large construction shows where Dana has exhibited. The Bauma exhibition last year drew more than a half million visitors, with 38 percent of them from outside Germany. The Bauma China construction show in 2012 attracted 177,000 visitors from 141 countries and more than 2,700 exhibitors from 38 countries, with 13 percent of the attendees and more than 30 percent of the exhibitors coming from outside China.Also, the 2011 Intermat convention was toured by more than 200,000 attendees, including more than a third from outside France.

While the construction industry is becoming more global, construction equipment is certainly not becoming universal.The front-end loader used on a building site in London is far different from the front-end loader found in Shanghai – even if it is made by the same manufacturer.The reasons for the differences are numerous: fuel costs and availability, labor costs, operator experience, emissions regulations, maintenance costs and service support, expected payback schedules for technology upgrades, total cost of ownership calculations, and so on.

Another view of the show floor at CONEXPO-CON/AGG 2014

More than ever, it is important for equipment manufacturers – and the tier-one suppliers who support them – to have a deep understanding of local preferences and a broad product line that meets them.

This local knowledge does not come easy.It takes years to develop relationships with manufacturers and customers in a way that not only allows you to understand where the market is now, but also to predict where the market will go in the future.

Global OEMs are making substantial investments in infrastructure and technical recruitment to establish a local presence, with North American and Western European manufacturers looking to emerging markets in Asia-Pacific and South America, and vice versa.Some recent examples:

Caterpillar invested about US$53 million to build a 108,000 square-foot (10,000 square-meter) research and development facility in Wuxi, Jiangsu Province, China, propelling the development and launch of the 986H front-end loader.

Last spring, JCB launched construction of the company’s fourth manufacturing facility in India on a 115-acre site in Jaipur, costing an estimated US$80 million.

John Deere recently opened two new facilities in Indaiatuba, São Paulo, Brazil, to manufacture backhoe loaders, front-end loaders, and excavators.

At CONEXPO, Chinese-based Lonking announced a plan to sell four models of wheeled excavators and three front-end loaders to U.S. customers online, with customer support and after-sales service provided at more than 120 U.S. locations.

Over the past several decades, Dana has also established solid footholds in key markets around the globe, and this process continues. In 2013, we opened a 129,000 square-foot (12,000 square-meter) technical center in Wuxi, China, to provide advanced product and applications engineering for China and throughout the Asia-Pacific region.Earlier this year, we fortified our operations in India by inaugurating a 90,000 square-foot (8,000 square-meter) technology center in Pune, our 13th facility in this key market.

The close proximity to customers is critical to continued success in today’s global market. With local engineers and world-class development and testing capabilities, equipment manufacturers and their tier-one suppliers can respond quickly and seamlessly to customer requests and shifts in the market with quality products, proven technology, and responsive service.

You can see the results of these efforts in the range of construction drivetrain solutions Dana offers for the construction market.At CONEXPO, we presented a 23-ton (21-tonne) front-end loader drivetrain system that can be customized with a wide variety of transmissions – each one offering a specific mix of options and capabilities tailored to local preferences.The selections ranged from Spicer® Rui Ma™ transmissions and axles that offer an optimized blend of product features, performance, dependability, and cost demanded by equipment buyers in emerging markets up to the fuel-saving Dana Rexroth R2 hydromechanical variable transmission (HVT), a powersplit system that seamlessly combines mechanical and hydrostatic travel drives.

Our meetings with customers at CONEXPO this year were very encouraging, and there is every indication that the global construction industry is revving up for a period of steady, sustained growth. We’d like to hear about your experiences at CONEXPO:

What caught your eye at CONEXPO this year?

What are the unique equipment preferences in your part of the world?

What are the universal expectations of construction equipment buyers, regardless of where they are located?

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